Lawmakers want SEC to name names in ‘London Whale’ case

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“While the $920 million settlement constitutes a significant rebuke to the institution, I believe that the government must hold accountable those individuals who compromised the integrity of our nation’s financial markets,” Sen. John McCain (R-Ariz.) said in a letter sent to Securities and Exchange Commission (SEC) Chairwoman Mary Jo White. “The government’s incomplete enforcement actions to date fail to achieve that goal.”

Regulators have previously filed charges against two of the bank’s London traders, but McCain, who is the top Republican on the Homeland Security and Governmental Affairs Permanent Subcommittee on Investigations, pointed out acts by higher officials that seem to have gone unpunished.

“At one point in August 2011, CEO Jamie Dimon ordered that the investment bank withhold daily profit and loss (P&L) reports from the [Office of the Comptroller of the Currency] because he believed that the regulators did not need the information. He, in fact, reacted angrily when the bank’s CFO, Douglas Braunstein, resumed sending the information to regulators,” he wrote.

“Even the powerful CEO of one of our nation’s largest banks does not get to make his own rules and decide which regulations are worthy of compliance.”

The subcommittee's chairman, Sen. Carl Levin (D-Mich.), added in a statement on Thursday that “the whole issue of misinforming investors and the public is conspicuously absent from the SEC findings and settlement.”

Sen. Jeff Merkley (D-Ore.) said that regulators’ inability to crack down on misleading practices undermined new financial regulations crafted in the wake of the 2008 financial crisis.

“This no-accountability approach to financial regulation led to the reckless risk-taking that caused the financial crisis and Great Recession,” he said. “We have new rules on the books, like the Volcker firewall, to reduce risky behavior. But if regulators refuse to impose accountability and transparency, we will keep repeating the failures of the past.”